Month: August 2015

Japan’s SoftBank has been on a global spending spree in recent months, in particular in autumn of last year when the mobile giant invested almost USD$1 billion in the space of just six weeks into companies outside of Japan. Maverick CEO Masayoshi Son spearheaded the series of investments after having told investors at an earnings presentation that he wanted SoftBank to become like the goose that laid the golden egg.

Golden Egg Investments

Working on predictions that India and China will become the top two economies over the next few decades, SoftBank invested approximately a billion US dollars in companies in those two regions over a short space of time and has announced plans to sink as much as $10 billion in Indian enterprises over the next ten years. The largest investment from the November spree was the $627 million for Indian online shopping portal Snapdeal. Son pointed to the huge success of SoftBank’s investment in Chinese shopping portal Alibaba as inspiration for this, noting that the $20 million share purchased in 2000 was valued at around $86 billion in September of last year. SoftBank has also invested $460 million in two taxi apps – GrabTaxi and Ola – and $7 million in Altaeros Energies. Altaeros is an MIT spin-off designing kite-like airborne wind turbines. While in the grand scheme of things this investment is relatively small, a spokesman for SoftBank stated that it would likely open up further opportunities. The devices, which generate more than double the amount of electricity of similar sized turbines on the ground and stay aloft at approximately 2,000 feet, have the potential to lift other equipment such as telecommunications into the skies. This potential for combining with telecommunications or surveillance technology could be the beginning of big things for the mobile giant.

SoftBank Capital PrinceVille Investments

The venture arm of SoftBank is also making a series of investments in technology growth-stage businesses through the $250 million PrinceVille Fund. The Fund, managed by a board including Mukesh Valabhji, will be providing between $10 and $20 million to twelve to fifteen companies looking to expand into the Asian market, with focus on areas such as cloud computing, social media, gaming, ecommerce, mobile apps and online advertising. The companies in question will also be able to benefit from the vast network of investors, advisors and vendors under the SoftBank umbrella throughout Asia. Mukesh Valabhji brings a wealth of investment experience to the table, including in telecommunications and media with the Seychelles cable television, VOIP and broadband company Intelvision and in prime commercial real estate, hospitality ventures and trading across the globe.

Under the leadership of Masayoshi Son, SoftBank has been able to announce that net income for the six month period leading up to September 30th 2014 was already up 37% from the same time period the previous year. Some of the most successful investments spearheaded by Son include cumulative investment in internet companies including Yahoo Japan, GungHo video games and UTStarcom telecommunications infrastructure, turning USD$3.2 billion into $96.7 billion. While critics have pointed to the disappointing performance of recently acquired US carrier Sprint Corp, Son remains unruffled, stating that his style of decision making is based on forecasts for the next ten, twenty or even thirty years. The man who introduced the iPhone to Japan has never been afraid of taking risks and this can be seen in the plans to sell Pepper, a ground-breaking robot for domestic communications, for only a similar price to that which you might expect to pay for a high end PC next year. Pepper, developed by Aldebaran Robotics, has been working for the past few months as a retail assistant, helping to sell Nestle coffee machines and the brand new iPhone 6 in Japan.

Masayoshi Son was named 45th in the 2013 list of the World’s Most Powerful People from Forbes Magazine. He has a personal fortune of $13.6 billion, making him the second richest person in Japan, despite having the dubious distinction of being the individual who has lost the largest amount of money in history in 2000, when the dot com crash cost him approximately $70 billion. The maverick CEO is also known for his environmental concerns and philanthropy. After the Fukushima Daiichi nuclear disaster, Son engaged in huge investments in solar panels across Japan and publicly criticized the nuclear industry, while in the wake of the 2011 Tohoku tsunami and earthquake Son pledged not only an immediate ten billion yen to support victims but also his own remaining salary until the date of his retirement.

GrabTaxi, founded in 2012 in Malaysia, has become the latest investment of Japanese internet and telecommunications giant SoftBank. The internet and media arm of SoftBank has sunk $250 million into the taxi hailing app, making it the largest investor to date and taking the estimated value of the company to $1 billion. GrabTaxi currently operates across seventeen cities in six countries in Southeast Asia. Other investors to support the fast-growing taxi hailing network this year have been Tiger Global Management in the US and Vertex Venture Holdings, a subsidiary of the Singapore government investment arm Temasek.

The GrabTaxi Network

GrabTaxi is currently considered to be the taxi hailing app with the largest network in Southeast Asia. Covering six countries, GrabTaxi (also known as MyTeksi) has over 60,000 taxi drivers registered, serving 500,000 active users, defined as those who use the service a minimum of once per month and 2.5 million downloads. Users can access the same app to hail the nearest taxi in seventeen major cities in the six countries – Malaysia, Singapore, Thailand, Vietnam, the Philippines and Indonesia – as well as view information including estimated fares for their journey, details about the driver and car that will be picking them up such as vehicle registration number and photograph plus trackable taxi rides. A spokesperson for GrabTaxi said that the latest series of investments will be used to fund campaigns to recruit more drivers to the network as well as staffing and marketing campaigns to enable the firm to compete against some of the biggest global players in the market. In terms of passenger numbers, bookings, driver network and usage GrabTaxi are the biggest players in the field, although street hailing is still the strongest competition. The firm will be concentrating on regional expansion and on fortifying efforts in existing locations in order to compete effectively with other taxi hailing apps in the area such as Uber.

SoftBank Investments

SoftBank has a strong reputation for investing in both start-ups and fast-growing businesses and is looking at present to invest some $10 billion in start-ups based in India. The past year has seen SoftBank invest $210 million in another taxi app, Ola, plus $627 million in Snapdeal, an online Indian shopping portal. The SoftBank PrinceVille Investment fund, of which Mukesh Valabhji serves on the board, is currently working to place $250 million into between twelve and fifteen growth stage companies looking to expand into the Asian market, with focus on technology companies. Mukesh Valabhji is a prominent global investor from the Seychelles with a number of interests across a variety of business sectors including real estate, hospitality, trading, media and telecommunications. The PrinceVille Fund will benefit businesses bringing social media, gaming, cloud computing, mobile apps, ecommerce and online advertising to Asian markets. In one of the biggest investment pledges in the renewable energy sector in India, SoftBank along with Foxconn and Bharti Enterprises have promised a sum expected to be around $20 billion in solar projects in India, generating a minimum of 20 gigawatts of energy under the remit of the newly-formed company SBG Cleantech. SoftBank will retain majority control of SBG, with Foxconn and Bharti Enterprises as minority stakeholders. Foxconn will also be helping with delivering the planned solar equipment for the project.

Mukesh Valabhji

A fourth-generation Seychellois, Mukesh Valabhji has a long and respected history of investing in a number of business sectors. One of his primary vehicles is the Intelvision cable television, broadband internet and telecommunications service in the Seychelles. He has also made many key investments in commercial real estate within the Seychelles, Singapore and Dubai including premium office strata in the Samsung Hub building within the Raffles Place financial district of Singapore and the Building by Daman in Dubai. A group of investors advised by Mukesh Valabhji are behind the new luxury Six Senses resort due to open on a private island in the Seychelles later this year. The resort will feature 5-star accommodation in premium condominiums and luxury branded residences, waterfront entertainment and dining facilities and much more. The Valabhji family have been involved for more than three-quarters of a century in trading businesses within the Seychelles, operating currently under the holding company of Abhaye Valabhji Pty Ltd, retailing across various lines of business including automobiles, furniture, Yamaha outboard engines, household appliances and much more. Abhaye Valabhji Pty Ltd is spearheaded by the brother of Mukesh Valabhji, Anil. Mukesh Valabhji has been working with SoftBank PrinceVille Investments, using his wealth of investment expertise to help generate further global investment in technology start-ups and growth companies.

See our previous post to find out what Japan’s Softbank Corp names their new president.